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Mediation for employment-related disputes

The Law on Mediation for Civil Disputes (6325) and the Law on Mediation for Civil Disputes (28540) came into force on June 22 2013. This legislation established a more comprehensive framework for mediation in employment disputes than the mediation processes used in collective labour agreements under the Collective Labour Agreement, Strike and Lock-Out Law.

Mediation cannot be used for all civil disputes and is limited to disputes that arise between the parties from transactions performed of their own free will. Cases in which the parties have no authority to act on their own free will cannot be resolved through mediation – for example:

criminal cases;

administrative cases;

civil registry cases;

parental or custody cases; and

domestic violence cases.

Mediation

Labour law disputes can be settled through mediation, including disputes relating to:

severance and notice payments;

education expenditure;

penalty clauses;

overtime; and

all other matters between employees and employers.

The employee or employer can decide whether to mediate or litigate the issue in question. According to Law 6325, parties may request the start of mediation at any time in the legal proceedings or even before legal proceedings have commenced. Parties do not lose the right to initiate a lawsuit once they request mediation and are free to waive the right to mediate. Even if they decide to mediate and cannot reach a settlement, parties still have the right to litigate and have their case heard by a court.

Instead of resolving disputes through litigation, reconciliation is preferred with regard to the preservation of social peace. For instance, compared to employer-employee litigation – where there are ongoing interactions or an employment agreement between the parties – relationships can be preserved in a healthier way through mediation and it can be a quicker, cheaper resolution method. A mediator cannot call for expert witness opinions or hear witness testimony. The main expense in mediation is the mediator's fee. The parties do not have to pay:

expert witness fees;

on-site discovery fees;

attorney's fees; or

other traditional litigation costs.

Unless otherwise agreed, the mediator's fee is determined in accordance with the minimum mediator fee tariff and is borne equally by the parties along with the expenses. Mediation is confidential and content cannot be used in any subsequent court proceedings. The mediator's notes, observations and declarations are confidential. While most court proceedings are public, non-party participants cannot be present at mediation without the consent of the parties.

Win-win concept
Mediation is based on a win-win concept. It is considered the most common and successful alternative dispute resolution method. Other methods usually have a winner and a loser. In litigation and arbitration there is always a winner, a loser and a decider – whether a judge or an independent arbitrator. In mediation, both parties have the opportunity to win and the deciders are the parties themselves, not the mediator. The mediator assists the parties in making their own decisions and agreements.

Labour disputes
Pursuant to Ministry of Justice statistics on mediation, mediation is mainly used in labour disputes. Labour disputes constitute 78% of mediation applications based on employee receivables and labour agreements. Between the entry into force of Law 6325 and July 2015, 487 labour disputes in Turkey used mediation to reach a settlement. Among these disputes, 484 concerned employee receivables and three concerned labour agreements.(1) Only in four of the 487 labour disputes was a settlement not reached through mediation. The statistics illustrate the popularity of mediation as an alternative dispute resolution method.

Enforcement
One issue regarding mediation is whether the outcome creates an enforceable obligation between the parties. The agreement to mediate is considered a contract under the Law of Obligations. Therefore, in principle, the agreement signed following the mediation process is binding on the parties as a contract with duties to perform. Further, provided that an agreement is reached at the end of the mediation process, the parties may sign an agreement which incorporates the settlement provisions and ask the court to enforce it. If the parties agreed to mediate before commencing litigation, the court must determine whether it has the authority to enforce the settlement, which includes examining whether the nature of the dispute is based on the actions of the parties' own free will. If the parties had already commenced litigation and then requested mediation, enforcement should be sought from the court where the matter is pending. When the court agrees to enforce a settlement agreement, it will issue an enforcement annotation. The agreement containing an annotation will be considered a document with the force of a verdict.

Comment

Mediation of employment-related disputes has many advantages in terms of cost efficiency, objectivity, confidentiality and timeliness, including the following:

Mediation allows disputing parties to reach an agreement amicably thanks to the participation of a neutral third party. In contrast to litigation and arbitration, the third party does not have authoritative power over the parties and cannot impose a decision on the parties.

Mediation provides participants with confidentiality. While lawsuits are generally open to the public, mediation is strictly confidential unless the parties agree otherwise.

Mediation may reduce the dispute resolution costs of the parties. Instead of paying court filing fees – which in most cases are based on a dollar quantification of the value of the case (at present 6.831%) for expected expert witness fees and on-site discovery fees – parties that mediate must bear the cost of the private mediator only.

If the dispute is settled through mediation, the parties may avoid lengthy court proceedings, which could take several years. In this regard, mediation is also a time-efficient solution.

The appointment of a mediator and the confidentiality rules allow the parties to freely self-assess the disputed issues, which may include fault or failure attributable to them.

Proposing mediation to the other party shows the requesting party's good faith in trying to reach an amicable solution.

Compare jurisdictions: Arbitration

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